SPAR Group Reports 2008 First Quarter Financial Results
TARRYTOWN, N.Y., May 1, 2008 (PRIME NEWSWIRE) -- SPAR Group, Inc. (Nasdaq:SGRP) today reported improved financial results for the first quarter ended March 31, 2008.
Net revenues for the 2008 first quarter rose 13% to $17.5 million from $15.4 million a year ago. The company’s net loss narrowed to $250,000, equal to $0.01 per share, for the 2008 first quarter, from a net loss of $509,000, or $0.03 per share, last year. Selling, general and administrative expenses for the 2008 first quarter decreased to $4.7 million from $5.0 million a year ago.
“The improved first quarter results reflect solid growth from our international operations, which posted net profits for the first time since 2005, as well as management’s efforts to control expenses,” said Gary Raymond, SPAR Group’s president and chief executive officer. “Economic conditions in the United States continue to impact our domestic operations, but we are actively concentrating on programs to grow revenues, and provide solutions to our existing and prospective clients as they seek ways to enhance their operations.”
SPAR reported that international revenue for the 2008 first quarter rose 43% to $10.0 million from $7.0 million last year. The division posted net income of $69,000, compared with a net loss of $118,000 for the 2007 first quarter.
Revenue in the U.S. for the 2008 first quarter amounted to $7.5 million, compared with $8.4 million a year ago. Net loss attributable to the company’s U.S. operations amounted to $319,000 for the 2008 first quarter, compared with a net loss of $391,000 last year.
About SPAR Group
SPAR Group, Inc. is a diversified international marketing services company, providing a broad array of services to help companies improve their sales, operating efficiency and profits at retail worldwide. The company provides in-store merchandising, in-store event staffing, RFID and other technology, as well as research, to manufacturers and retailers covering all product classifications and all classes of trade, including mass market, drug store, convenience store and grocery chains. The company operates throughout the United States and internationally in Japan, Canada, Turkey, South Africa, India, Romania, China, Lithuania, Latvia, Estonia, Australia and New Zealand. For more information, visit SPAR Group’s Web site, www.sparinc.com.
Certain statements in this news release are forward-looking, including, but not limited to, further benefits to be derived from the continued efforts to grow domestic revenues and curtail costs. The company’s actual results, performance and trends could differ materially from those indicated or implied by such statements as a result of various factors, including (without limitation), the continued strengthening of SPAR Group’s selling and marketing functions, continued customer satisfaction and contract renewal, new product development, continued availability of capable dedicated personnel, continued cost management, the success of its international efforts, success and availability of acquisitions, availability of financing and other factors, as well as by factors applicable to most companies such as general economic, competitive and other business and civil conditions. Information regarding certain of these and other factors that could affect future results, performance or trends are discussed in SPAR Group’s annual report on Form 10-K, quarterly reports on Form 10-Q, and other filings made with the Securities and Exchange Commission from time to time.
SPAR Group, Inc.
Consolidated Statements of Operations
(unaudited)
(in thousands, except per share data)
|
| Three Months Ended |
| ||||
|
| March 31, |
| March 31, |
| ||
|
| 2008 |
| 2007 |
| ||
|
|
|
|
|
| ||
Net revenues |
| $ | 17,454 |
| $ | 15,413 |
|
Cost of revenues |
|
| 12,484 |
|
| 10,498 |
|
Gross profit |
|
| 4,970 |
|
| 4,915 |
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
| 4,658 |
|
| 5,005 |
|
Depreciation and amortization |
|
| 208 |
|
| 197 |
|
Operating income (loss) |
|
| 104 |
|
| (287 | ) |
|
|
|
|
|
|
|
|
Interest expense |
|
| 81 |
|
| 89 |
|
Other expense |
|
| 43 |
|
| 21 |
|
Loss before provision for income taxes and minorityinterest |
|
| (20 | ) |
| (397 | ) |
Provision for income taxes |
|
| 164 |
|
| 67 |
|
Loss before minority interest |
|
| (184 | ) |
| (464 | ) |
Minority interest |
|
| 66 |
|
| 45 |
|
Net loss |
| $ | (250 | ) | $ | (509 | ) |
|
|
|
|
|
|
|
|
Basic/diluted net loss per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss - basic/diluted |
| $ | (0.01 | ) | $ | (0.03 | ) |
|
|
|
|
|
|
|
|
Weighted average common shares – basic |
|
| 19,129 |
|
| 18,934 |
|
|
|
|
|
|
|
|
|
Weighted average common shares – diluted |
|
| 19,129 |
|
| 18,934 |
|
Note: Certain reclassifications have been made to the prior period financials to conform to the current period presentation.
SPAR Group, Inc.
Consolidated Balance Sheets
(unaudited)
(in thousands, except share and per share data)
|
| March 31, |
| December 31, |
| ||
|
| 2008 |
| 2007 |
| ||
Assets |
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
Cash and cash equivalents |
| $ | 2,409 |
| $ | 1,246 |
|
Accounts receivable, net |
|
| 12,991 |
|
| 13,748 |
|
Prepaid expenses and other current assets |
|
| 1,177 |
|
| 975 |
|
Total current assets |
|
| 16,577 |
|
| 15,969 |
|
|
|
|
|
|
|
|
|
Property and equipment, net |
|
| 1,466 |
|
| 1,528 |
|
Goodwill |
|
| 798 |
|
| 798 |
|
Other assets |
|
| 1,679 |
|
| 1,648 |
|
Total assets |
| $ | 20,520 |
| $ | 19,943 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and stockholders’ equity |
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
Accounts payable |
| $ | 4,654 |
| $ | 3,631 |
|
Accrued expenses and other current liabilities |
|
| 4,735 |
|
| 3,981 |
|
Accrued expenses due to affiliates |
|
| 1,808 |
|
| 2,107 |
|
Customer deposits |
|
| 747 |
|
| 580 |
|
Lines of credit |
|
| 5,055 |
|
| 6,119 |
|
Total current liabilities |
|
| 16,999 |
|
| 16,418 |
|
|
|
|
|
|
|
|
|
Other long-term liabilities |
|
| 266 |
|
| 299 |
|
Minority Interest |
|
| 741 |
|
| 676 |
|
Total liabilities |
|
| 18,006 |
|
| 17,393 |
|
|
|
|
|
|
|
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
|
Preferred stock, $.01 par value: |
|
|
|
|
|
|
|
Authorized shares-3,000,000 |
|
|
|
|
|
|
|
Issued and outstanding shares- |
|
|
|
|
|
|
|
89,286 - March 31, 2008 |
|
| 1 |
|
| — |
|
Common stock, $.01 par value: |
|
|
|
|
|
|
|
Authorized shares-47,000,000 |
|
|
|
|
|
|
|
Issued and outstanding shares- |
|
|
|
|
|
|
|
19,129,177 - March 31, 2008 |
|
|
|
|
|
|
|
19,089,177 - December 31, 2007 |
|
| 191 |
|
| 191 |
|
Treasury stock |
|
| (1 | ) |
| (1 | ) |
Additional paid-in capital |
|
| 12,198 |
|
| 11,982 |
|
Accumulated other comprehensive loss |
|
| (46 | ) |
| (43 | ) |
Accumulated deficit |
|
| (9,829 | ) |
| (9,579 | ) |
|
|
|
|
|
|
|
|
Total stockholders’ equity |
|
| 2,514 |
|
| 2,550 |
|
| $ | 20,520 | $ | 19,943 | |||
CONTACT: | SPAR Group, Inc. |
| James R. Segreto, Chief Financial Officer |
| (914) 332-4100 |
| PondelWilkinson Inc. |
| Roger S. Pondel |
| (310) 279-5980 |